On 29 June 2023, the Financial Service and Markets Bill received Royal Assent, becoming the Financial Services and Markets Act 2023 (FSMA 2023) (HM Treasury Press Release). The Bill was introduced to Parliament in July 2022 (see FC Feature 20 July 2022).
FSMA 2023 implements the proposals in the Future Regulatory Framework Review, which was established to determine how the financial services regulatory framework should adapt to the UK's new position outside the EU and ensure it is fit for purpose (see FC Feature 20 July 2022).
The adjustments that will be made to the UK financial services landscape by FSMA 2023 are significant and wide-ranging. The Act:
- creates a blueprint for the repeal of retained EU law on financial services. In its place, the Act establishes the statutory framework for a comprehensive FSMA model of regulation through which HM Treasury and financial services regulators will create legislation and rules designed specifically for the UK markets;
- enhances the FCA and PRA's rule-making powers and responsibilities and introduces new secondary objectives for the regulators to facilitate the competitiveness and growth of the UK economy;
- paves the way for further reforms in a number of policy areas through a new designated activities regime. These will include a new regulatory framework for public offers of securities and admissions to trading on regulated markets that will replace the existing UK prospectus regime;
- implements the outcome of the Wholesale Markets Review (see FC Feature 1 March 2022) to simplify regulation in these markets;
- brings stablecoins into the regulatory perimeter and enables the government to introduce a regime to regulate wider cryptoasset activities; and
- contains new consumer protection measures, including a regulatory gateway for financial promotions made by unauthorised firms, measures to help protect access to cash and greater protection for victims of authorised push payment fraud.
FromCounsel will publish an overview of key aspects of FSMA 2023 for corporate practitioners in due course.
